According to Bloomberg, BlackRock has introduced a tokenized money-market fund, the BlackRock USD Institutional Digital Liquidity Fund. The fund invests in cash, US Treasury bills, and repurchase agreements. Investors in the fund receive a cryptocurrency called BUIDL, valued at $1 per token. BlackRock has been a significant advocate for crypto among mainstream financial firms, with its Chairman and CEO supporting digital wallets approved by the company.
The tokenized fund serves three main use cases, according to Carlos Domingo, CEO of Securitize Markets, the platform on which the fund is listed. Domingo highlights the institutional nature of the fund, managed by the world's largest asset manager, and the absence of counterparty risk to any crypto company. In 2021, Franklin Templeton launched the first US-registered tokenized money-market fund, which had approximately $324 million in assets at the end of February. However, BENJI, the token representing shares of Franklin Templeton's fund, is different from BUIDL.
Securitize Markets is an alternative trading system registered under the US Securities and Exchange Commission (SEC) and holds a broker-dealer license under the Financial Industry Regulatory Authority. Its affiliated company is a registered transfer agent with the SEC, allowing clients to transfer tokens between each other. Domingo notes that the SEC has not issued guidance on whether a firm must use a private or public blockchain for tokenization. He believes that the public Ethereum blockchain is a battle-tested infrastructure suitable for the activities performed by Securitize Markets.